Houston, TX Solar Panels
Solar Power in Houston
Houston electricity prices have risen 28% since 2020, and more local homeowners are turning to solar to stabilize their energy costs for the long term.
This guide covers everything you need to know about solar panels for your home — from how they work to what the installation process looks like in Houston.
How Much Do Solar Panels Cost in Houston, TX?
Based on real installations across Houston — from Sugar Land and The Woodlands to Pearland and Katy — this calculator uses Palmetto’s local data to give you an accurate estimate of what solar installation could cost for your home.
System
- No upfront investment
- Palmetto handles all maintenance
- 90% Production Guarantee
- Comprehensive protection program included
Key Takeaways
- Houston electricity prices have risen 28% since 2020 — solar panels help homeowners lock in lower energy costs and protect against future rate increases.
- Houston homeowners can save an average of $76,000 over 25 years with solar, plus benefit from Texas’ 100% property tax exemption on added home value.
- Going solar in Houston requires no upfront cost — Palmetto’s LightReach lease lets you start saving from day one with no maintenance responsibilities.
Houston Electricity Prices
Electricity costs in Houston have climbed steadily — and understanding that trend can help you make smarter energy decisions.
Texas electricity rates rose from 12.1 cents per kWh in 2021 to 14.9 cents per kWh in 2024 — a roughly 23% increase in just three years, outpacing many household budget expectations.
Solar panels allow Houston homeowners to generate their own electricity, reducing dependence on the grid and providing a buffer against continued rate increases from local utility providers.
Over a system’s 25-plus year lifespan, that protection from rising rates can add up to significant savings — making solar less of an upgrade and more of a long-term financial strategy.
Price of Energy: Texas vs National Average
Houston Area Utility Providers
Most Houston homeowners get their electricity through Entergy Texas. Based on 2023 data, Entergy Texas customers pay around 13.2¢ per kWh — below the Texas state average of 14.5¢ and the national average of 16.0¢.
Even so, Houston electricity costs aren’t immune to volatility. Rates tied to natural gas prices and high grid demand — especially during intense summer heat — can cause meaningful spikes in monthly energy bills for Entergy Texas customers.
For Houston homeowners, solar can help offset grid dependence and bring more consistency to energy costs over time — regardless of where Entergy Texas rates may head in the future.
Houston Utilities Electricity Rates
Texas Solar Incentives
Houston homeowners can take advantage of several solar incentives in Texas that help reduce both the upfront and long-term costs of going solar.
The most broadly available benefit is the Texas Solar Property Tax Exemption, which exempts 100% of the added home value from your property taxes — statewide. Houston homeowners in CenterPoint’s service territory may also qualify for Tesla Electric’s Virtual Power Plant monthly bill credit.
Note: The federal residential solar tax credit was eliminated by the Big Beautiful Bill. State incentives still apply. With a Palmetto LightReach lease, Palmetto handles the commercial tax credit and passes savings through lower monthly payments.
| Incentive | Type | Description | Source |
|---|---|---|---|
| Texas Solar Property Tax Exemption | Property Tax Exemption | Texas homeowners receive a 100% property tax exemption on the added home value from a solar installation under TX Tax Code Section 11.27. | Learn More |
| Texas Solar Energy Devices Franchise Tax Exemption | Tax Credit | Texas businesses can deduct the cost of a solar energy device from their state franchise tax liability. | Learn More |
| Tesla Electric Virtual Power Plant (VPP) Program | Rebate | Powerwall owners in CenterPoint’s service territory in Houston can earn a $10/month electric bill credit by enrolling their battery in Tesla Electric’s Virtual Power Plant program. | |
| Texas Solar Rights Protection (HOA Solar Access Law) | Net Metering | Texas law prohibits HOAs, municipalities, and other entities from preventing homeowners from installing rooftop solar panels. | Learn More |
Under Texas Tax Code Section 11.27, the added value that a solar energy system brings to your home is 100% exempt from property tax assessments. Since solar panels can increase a home’s market value by $15,000–$25,000, this exemption can save homeowners an estimated $400–$600 per year in property taxes — potentially more than $10,000 over the lifetime of the system.
To qualify, the solar system must be owned (not leased) and primarily used to produce and distribute energy consumed on-site. Eligible systems include solar photovoltaic panels for electricity generation as well as solar thermal devices such as solar water heaters. The exemption has been available to Texas homeowners since 1978 and applies statewide.
To receive the exemption on your tax bill, residents of Houston must file Form 50-123 with your county appraisal district by April 30 of the tax year. This is a permanent, ongoing benefit — one of the most valuable solar incentives available to Texas homeowners in 2026.
Texas law allows businesses to deduct the full cost of a qualifying solar energy device from their state franchise tax. This incentive is designed for commercial and business entities — not individual residential homeowners — and can meaningfully reduce the upfront cost of a commercial solar installation.
Qualifying solar energy devices include systems that convert solar energy into thermal, mechanical, or electrical energy, as well as systems that store or distribute that converted energy. This makes both solar PV systems and solar thermal installations eligible for the deduction.
Businesses considering a solar installation should consult a tax professional to determine how this deduction interacts with other business tax strategies. For more details, visit the Texas Comptroller’s franchise tax page or contact the Comptroller’s office directly.
Tesla Electric offers a Virtual Power Plant (VPP) program for Powerwall owners in select areas of CenterPoint’s service territory in Texas. Participants receive a $10 per month electric bill credit in exchange for allowing Tesla to discharge their Powerwall’s stored energy back to the grid during periods of high demand or grid stress.
To participate, homeowners must use Tesla Electric as their Retail Electricity Provider (REP) and own a Tesla Powerwall battery system. The program is designed to support grid reliability on the ERCOT grid while providing Powerwall owners in Houston with a modest ongoing financial benefit that helps offset the cost of their battery investment.
This program is particularly relevant given Texas’ history of grid reliability challenges. Homeowners interested in enrolling should visit Tesla’s website or contact Tesla Energy directly to confirm current eligibility, service territory coverage, and enrollment steps.
Texas has strong solar access protections enshrined in state law that prevent homeowners associations (HOAs), municipalities, villages, and other private entities from prohibiting or unreasonably restricting the installation of rooftop solar panels. This means that even if your HOA has aesthetic guidelines, it cannot outright ban solar installations on your home.
While HOAs may still impose reasonable restrictions related to placement or appearance — such as requiring panels not to be visible from the street — they cannot use these rules as a de facto ban on solar. This protection gives homeowners in Houston the legal right to go solar regardless of their HOA’s preferences, removing a common barrier to adoption.
If you believe your HOA is unlawfully restricting your ability to install solar panels, you may wish to consult the relevant sections of the Texas Property Code or seek legal advice. This protection applies statewide and is an important foundational right for all Texas solar homeowners.
Ready to start saving with solar?
Speak with a Palmetto solar expert to find out exactly how much you can save with Texas incentives.
Get a Free QuoteHouston Solar Irradiance
Solar panel production varies throughout the year based on daylight hours, weather patterns, and sun intensity. Understanding how seasons affect your solar system helps set realistic expectations for your investment.
Houston’s sunny climate and low latitude make it great for solar. Despite occasional humidity and storms, the city averages over 200 sunny days a year, maximizing energy production year-round.
Solar Production in Houston by Month
What Can Your Solar System Power?
Summer Production (July)
In July, your 10 kW system could power:
- 3.6 average homes (15 kWh/day per home)
- or Run central AC for 18 hours AND power all other appliances
- or Fully charge 5.4 Tesla Model 3 electric vehicles
Winter Production (December)
In December, your 10 kW system could power:
- 2 average homes (15 kWh/day per home)
- or Keep your home heating system running for 15 hours
- or Fully charge 3 Tesla Model 3 electric vehicles
Annual Production
Over a year, your 10 kW system could:
- Offset 10 tons of carbon dioxide emissions
- or Equal the environmental benefit of planting 175 trees
- or Save approximately $4,234 in electricity costs
Want to know exactly how much solar can power your home?
Get a personalized solar analysis based on your actual home, energy usage, and roof characteristics.
Get My Custom EstimateSolar Panel Systems in Houston
We’ve mapped thousands of solar installations across Houston so you can see just how many of your neighbors have already made the switch. Explore the map below to discover which communities are leading the way in clean energy — your neighborhood might surprise you!
Leasing Solar Panels
Houston homeowners served by CenterPoint Energy can go solar through Palmetto’s LightReach program using a Power Purchase Agreement (PPA). With a PPA, you don’t pay a fixed monthly lease — instead, you pay for the electricity your panels actually produce, at a set rate per kilowatt-hour (kWh). Because Houston summers are long and sunny, your system will produce more power in summer months, meaning higher solar bill savings when your utility bill would otherwise peak.
Compared to buying a system outright, a PPA requires no upfront cost. There’s no large cash investment to recoup, no loan to manage, and no maintenance responsibilities to take on. Palmetto owns the system and handles all upkeep — so if something needs attention, that’s on us, not you. For many Houston homeowners, that peace of mind alone makes a PPA worth considering. Learn more about how buying compares to leasing.
Over the course of a year, PPA payments tend to average out similarly to what a fixed monthly lease would cost — the difference is simply how the bill is calculated each month. If you’re looking for a straightforward way to go solar in Houston without a large upfront commitment, a PPA through Palmetto LightReach is a practical option worth exploring.
Go solar without the investment
With LightReach, there are no investment costs to recoup, loan payments to manage, or maintenance needs to take on. As soon as your panels are active, your solar savings are too!
Learn MoreFrequently Asked Questions
Yes, solar makes strong sense for Houston homeowners. With over 200 sunny days per year and 5.2 average peak sun hours daily, Houston’s climate is well-suited for solar production. Electricity rates have risen 28% since 2020, and the average Houston homeowner can save approximately $76,000 over 25 years with solar panels.
If upfront cost is a concern, Palmetto’s LightReach solar lease removes that barrier entirely — Houston homeowners can go solar with no money down and start saving from day one, with no maintenance responsibilities.
Houston does not have traditional net metering. Most Houston homeowners are served by CenterPoint Energy, which operates under a Net Billing (Export Credit) policy through Shell Energy’s Buyback Plan. Excess solar energy exported to the grid is credited at 7 cents per kWh — not the full retail rate — and applied to reduce your current month’s bill.
Any unused credits roll over monthly and are stored in a “buyback bank,” but are forfeited each December without a cash payout. Shell Energy also charges a $4.95/month fixed fee in addition to CenterPoint’s standard charges. Houston homeowners should factor this export credit structure into their solar savings expectations.
Yes, solar panels can increase your home value in Houston. According to a Zillow study, homes with solar panels sell for an average of 4.1% more than comparable homes without them. For a $350,000 Houston home, that’s roughly $14,350 in added value.
Texas makes this benefit even more attractive through the Texas Solar Property Tax Exemption, which exempts 100% of the added home value from property taxes — so Houston homeowners keep the full financial benefit without a higher tax bill.
For Houston homeowners, the most accessible way to go solar is through Palmetto’s LightReach lease — starting as low as $89/month for smaller homes with no upfront cost. Palmetto owns and maintains the system, so there’s nothing out of pocket to get started.
For those who prefer a cash purchase, a typical Houston system runs $20,000–$36,000 depending on home size. Note that the federal 30% residential solar tax credit is no longer available following the Big Beautiful Bill. Use the calculator above for a personalized estimate.
For many Houston homeowners, solar can be worth it from day one — especially with a lease. With Palmetto’s LightReach program, there’s no upfront cost. Your monthly lease payment is typically less than your current electricity bill, so savings begin immediately after installation.
Houston electricity rates have risen 28% since 2020, and leasing solar is a straightforward way to reduce your exposure to future rate increases — without a large investment or maintenance responsibilities.
Palmetto Solar is a top choice for Houston homeowners. We’ve completed 3,810 installations across Texas since 2020, backed by a trusted local install network and some of the best financing options in the industry.
Whether you prefer a cash purchase or a no-upfront-cost lease through our LightReach program, we make going solar in Houston straightforward. With Houston electricity rates up 28% since 2020, we’re focused on helping local homeowners take control of their energy costs.
With Palmetto’s LightReach lease, Houston homeowners pay one simple monthly payment that covers the solar system, installation, monitoring, maintenance, and a 90% Production Guarantee — with no upfront cost. For a typical 9.72 kW system in Houston, the estimated monthly payment is approximately $125/month.
Because Palmetto owns the system, it claims the commercial Investment Tax Credit (ITC) and passes those savings to you through lower monthly payments. Since the lease payment is typically less than your current electricity bill, most Houston homeowners start saving from day one.